Neighborhood Racial Composition & Police Spending

Olugbenga Ajilore
Associate Professor of Economics, University of Toledo

Key Findings

  • There is a relationship between neighborhood composition and police spending in support of the expenditure spillover theory, which says that increases in one county’s police spending pushes crime out of that county which induces increases in police spending by neighboring counties.
  • Median income and per-capita grants, have significant positive direct effects on police spending.


In the article, “The Spillover Effect of Race on Police Expenditures: An Alternative Test of the Minority Threat Hypothesis,” Ajilore examined the effect neighborhood composition and crime rate has on police spending. This is based on the expenditure spillover theory, which is the idea that police spending in certain neighborhoods, can displace crime to surrounding neighborhoods. Previous research on this topic has not been able to consistently connect crime, neighborhood composition, and police spending. For this study, Ajilore studied 3,109 counties in over three years to be one of the most comprehensive data set on the topic. Ajilore examined the police spending based on neighborhood composition, its racial composition and crime rate. The results supported the expenditure spillover theory, showing that police spending is affected by neighborhood composition, and can displace crime. The results also showed that police spending can be directly impacted by median income of the county and per-capita grants.

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